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Calculating wRVU rate in PP-Is this fair?

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  • Calculating wRVU rate in PP-Is this fair?

    I work as an employee in an ortho private practice. We have a 50% overhead/50% take home of collections compensation model. This stands no matter what your production threshold is. Essentially all compensation comes from personal professional collections. There is no significant profit sharing or ancillary income. The practice (and me) have a good payor mix; majority of commercial followed by medicare with little medicaid.

    When calculating my $/wRVU rate using my total collections x.50/wRVUs it comes out to $35/wRVU. I also calculated it for my other employed co-partners and their wRVUs are in the same range, mid to high 30’s. From MGMA data I’ve seen in recent years, the median for ortho is around $75/wRVU, and MGMA encompasses all types of practices, including private. This number corresponds with rates hospital employed docs will get that I’ve heard of.

    Am I (and my employed partners) getting significantly underpaid? Does the true lucrative potential of private practice only exist if you have access to ancillary income, profits, etc? From what I’ve read on here, 50% overhead seems to be a typical amount and considered fair. However half of the median $/wRVU rate does not seem to be very fair to me. Wondering what everyone else’s opinion on this setup/situation is.

  • #2
    Originally posted by legoman View Post
    I work as an employee in an ortho private practice. We have a 50% overhead/50% take home of collections compensation model. This stands no matter what your production threshold is. Essentially all compensation comes from personal professional collections. There is no significant profit sharing or ancillary income. The practice (and me) have a good payor mix; majority of commercial followed by medicare with little medicaid.

    When calculating my $/wRVU rate using my total collections x.50/wRVUs it comes out to $35/wRVU. I also calculated it for my other employed co-partners and their wRVUs are in the same range, mid to high 30’s. From MGMA data I’ve seen in recent years, the median for ortho is around $75/wRVU, and MGMA encompasses all types of practices, including private. This number corresponds with rates hospital employed docs will get that I’ve heard of.

    Am I (and my employed partners) getting significantly underpaid? Does the true lucrative potential of private practice only exist if you have access to ancillary income, profits, etc? From what I’ve read on here, 50% overhead seems to be a typical amount and considered fair. However half of the median $/wRVU rate does not seem to be very fair to me. Wondering what everyone else’s opinion on this setup/situation is.
    I have no idea what employed partners are. Are they employees or they are partners. If you are an employee you will be underpaid in PP

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    • #3
      Are you making 800k+?

      It not you’re probably underpaid as a full time somewhat busy ortho… unless as you mention you got something in the future building up or coming your way.

      Comment


      • #4
        Originally posted by legoman View Post
        I work as an employee in an ortho private practice. We have a 50% overhead/50% take home of collections compensation model. This stands no matter what your production threshold is. Essentially all compensation comes from personal professional collections. There is no significant profit sharing or ancillary income. The practice (and me) have a good payor mix; majority of commercial followed by medicare with little medicaid.

        When calculating my $/wRVU rate using my total collections x.50/wRVUs it comes out to $35/wRVU. I also calculated it for my other employed co-partners and their wRVUs are in the same range, mid to high 30’s. From MGMA data I’ve seen in recent years, the median for ortho is around $75/wRVU, and MGMA encompasses all types of practices, including private. This number corresponds with rates hospital employed docs will get that I’ve heard of.

        Am I (and my employed partners) getting significantly underpaid? Does the true lucrative potential of private practice only exist if you have access to ancillary income, profits, etc? From what I’ve read on here, 50% overhead seems to be a typical amount and considered fair. However half of the median $/wRVU rate does not seem to be very fair to me. Wondering what everyone else’s opinion on this setup/situation is.
        You mean your employed by a large corporation correct? If yes than your just employed, however that’s a weird comp model for employeed surgeons in my opinion. Fyi I’m family med employed and I’m getting $44/wrvu so maybe your math is incorrect or it’s correct and your getting ridiculously underpaid

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        • #5
          “I work as an employee in an ortho private practice. “
          Total comp for your time , you are an employee.
          Makes no difference if is a public/private or nonprofit. You are being paid on collections.
          I have no idea if the “owner” is making a profit or loss.

          Comment


          • #6
            To respond to the comments so far:


            -When I say "employed partners," I am referring to me and my physician co-workers who are all employees. We are not "partners" in the sense that we have any ownership stake.

            -Not making anything close to $800k, although my practice is still building with a long way to go. However some of the other employed physicians in the group are quite busy but are not making $800k either.

            -It's not a large corporation. We are a privately owned ortho group (we do have some other msk docs as well, pain, PMR, etc.). The owners of the practice are a few physicians who originally started it plus a minority of PE investors (more recent addition). Owners are definitely making a profit.

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            • #7
              Are you in desirable part of the country? $35 seems very low.
              and if you’re under 600-700k as busy ortho in PP, you are underpaid.

              Comment


              • #8
                Is this RVUs or WRVUs? Because there is a difference. Are you strictly calculating wRVUs?

                if so, do you mean you’ll make $350k if you generated 10k WRVUs? If that’s the case, you’re heavily underpaid.

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                • #9
                  It's a fairly large metro area, but wouldn't necessarily call it desirable.

                  This is wRVUs (work RVUs). 350k for 10k wRVUs is right.

                  Comment


                  • #10
                    Originally posted by legoman View Post
                    To respond to the comments so far:


                    -When I say "employed partners," I am referring to me and my physician co-workers who are all employees. We are not "partners" in the sense that we have any ownership stake.

                    -Not making anything close to $800k, although my practice is still building with a long way to go. However some of the other employed physicians in the group are quite busy but are not making $800k either.

                    -It's not a large corporation. We are a privately owned ortho group (we do have some other msk docs as well, pain, PMR, etc.). The owners of the practice are a few physicians who originally started it plus a minority of PE investors (more recent addition). Owners are definitely making a profit.
                    Is this the problem?

                    Comment


                    • #11
                      Originally posted by legoman View Post
                      It's a fairly large metro area, but wouldn't necessarily call it desirable.

                      This is wRVUs (work RVUs). 350k for 10k wRVUs is right.
                      I'm only in the interview process, but from what I've seen when shown "the books", this is heavily underpaid.

                      Comment


                      • #12
                        Someone is making a lot of money from the practice.

                        is there any pathway to becoming a partner/shareholder/owner ?

                        hospital employed surgeons may get paid well since they bring a ton of revenue to the ORs, imaging, other ancillary, etc. Private practice may pay well if the practice is busy and run well as the doctors are owners.

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                        • #13
                          Seems severely underpaid. What do other orthos in area make?

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                          • #14
                            Originally posted by legoman View Post
                            It's a fairly large metro area, but wouldn't necessarily call it desirable.

                            This is wRVUs (work RVUs). 350k for 10k wRVUs is right.
                            I live in a very desirable large metro area. I work pretty hard, but even in my underpaid employed model, I’d make about 650k for 10k WRVUs. That’s before the call pay, I make additional 100k on call pay. I’m still underpaid because my colleagues make about 750-800k for 10k RVUs in other areas of the country.

                            you’re getting screwed royally. You really need to figure out what’s going on. I don’t know any orthopedic surgeons that are paid so low. Someone is making a lot of money on your back.

                            Comment


                            • #15
                              Originally posted by Medstud21 View Post

                              I live in a very desirable large metro area. I work pretty hard, but even in my underpaid employed model, I’d make about 650k for 10k WRVUs. That’s before the call pay, I make additional 100k on call pay. I’m still underpaid because my colleagues make about 750-800k for 10k RVUs in other areas of the country.

                              you’re getting screwed royally. You really need to figure out what’s going on. I don’t know any orthopedic surgeons that are paid so low. Someone is making a lot of money on your back.
                              I have to agree....
                              My ortho docs are making anywhere from $750K-$1M in an employed arrangement!
                              We do live in a high cost of living area but as an OB/Gyn I am making way more than you... which is unheard of for OB to out earn ortho.
                              Sorry to have you hear this bad news... but you should be looking elsewhere.

                              Comment

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